Fiat Chrysler pays $800m to settle emissions cheating claim

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Fiat Chrysler pays $800m to settle emissions cheating claim

Fiat Chrysler agreed on Thursday to pay hundreds of millions of dollars, including a $300 million fine to the USA government, to settle allegations that the Italian-American automaker cheated on emissions tests. Fiat Chrysler will pay about $400 million in civil fines to different federal and state agencies.

The specific vehicles to be recalled include diesel-powered Ram 1500 and Jeep Grand Cherokee from the 2014-2016 model years.

This on a day when Fiat Chrysler also agreed to a settlement in the neighborhood of $800 million. An attorney for the company did not immediately respond to a call and email seeking comment Wednesday night.

FCA has agreed to pay almost $400 million in civil penalties, including $305 million to the EPA, the Department of Justice, and CARB; $6 million to Customs and Border Protection; and $72.5 million to various state attorneys general. The company has set aside more than $30 billion to cover costs and settlements, including $15 billion to buy back or fix vehicles in the U.S. About 500,000 VW vehicles were involved in the USA cheating scandal.

Fiat Chrysler will agree to corporate governance reforms meant to prevent future emissions violations under the agreement, the person said.

In last year's third quarter, Fiat Chrysler, also known as FCA, took an $810 million (700 million euros) charge to deal with possible USA diesel emissions settlement costs, cutting into the company's profits.

The U.S. Environmental Protection Agency first accused FCA of wrongdoing in January 2017 when it issued a notice alleging the company violated the Clean Air Act with excessive emissions of harmful nitrogen oxide.

Volkswagen admitted that its software was improperly installed to deceive emission-testing equipment by making engines put out much lower levels of the pollutants when being tested than they did in real-world driving situations. Roughly 100,000 vehicles are affected; of those, more than 13,000 are in California.

Since the VW scandal, CARB and the EPA have gone after other automakers and delayed their diesel-vehicle certifications.

As part of the recall, FCA will update emission control software on the offending vehicles and provide them with an extended warranty.

"Each of these vehicles differs materially from the specifications provided to EPA in the certification applications", the government said.

US officials refrained from accusing the auto manufacturer of intentionally creating software to cheat on emissions tests.

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